He abandoned regime change as an American goal. He shelved the so-called military option. He buried a carrot-and-sticks approach viewed with contempt by Iranians as fit only for donkeys. And he placed Iranâ€™s nuclear program within â€œthe full range of issues before us.â€

By doing so, Obama made it almost inevitable that one of the defining strategic issues of his presidency will be a painful but necessary redefinition of Americaâ€™s relations with Israel as differences over Iran sharpen. I will return to that below.

The innovations in the presidentâ€™s Persian New Year, or Nowruz, overture to Tehran were remarkable. He referred twice to â€œthe Islamic Republic of Iran,â€ a formulation long shunned, and said that republic, no other, should â€œtake its rightful place in the community of nations.â€ Here was explicit American acceptance of Iranâ€™s 30-year-old clerical revolution.

He said establishing constructive ties would â€œnot be advanced by threats,â€ a retreat from his own campaign position that the military option must always remain on the table. Instead he offered â€œmutual respect.â€

I was in Iran in January and February. The visit convinced me that confrontational American high-handedness has been a disaster; that facile analogies between the Iranian regime and the Nazis dishonor six million victims of the Holocaust; that the regimeâ€™s provocative rhetoric masks essential pragmatism; and that the best way to help a young, stability-favoring population toward the reform they seek is through engagement.

Obama has now taken all the steps I called for then. The policy changes emerged from an interagency review of the failed Iranian policy of recent years. The shift demanded courage.

One of the people involved in the review told me he had been bombarded by warnings from Israel and Sunni Arab states that engagement with Iran would lead nowhere. Of course they would say that; any Iran breakthrough will shake up current cozy U.S. relationships from Jerusalem to Riyadh. Obamaâ€™s overture represented a victory not only over such lobbying but also over officialsâ€™ favoring tightened sanctions or delaying any American initiative until after Iranâ€™s June presidential election.

The hard part has just begun.

Iranâ€™s supreme leader, Ayatollah Ali Khamenei, responded to Obama with a scathing speech at the countryâ€™s holiest shrine in Mashad, recalling every past U.S. misdeed, describing prerevolutionary Iran as â€œa field for the Americans to graze in,â€ and demanding concrete steps â€” like a lifting of sanctions â€” rather than words.

View all that as an opening gambit. Khamenei also quieted the crowd when it began its ritual â€œDeath to Americaâ€ chant and he said this: â€œWeâ€™re not emotional when it comes to our important matters. We make decisions by calculati on.â€

Thatâ€™s right: the mullahs are anything but mad. Calculation will demand that Iran take Obama seriously.

The countryâ€™s oil revenue has plunged, its economy is in a mess, its oil and gas installations are aging. It has deepening interests in a stable Iraq and an Afghanistan free of Taliban rule. Its nuclear program involves a measure of brinkmanship that must be carefully managed. Khameneiâ€™s essential role is conservative â€” the preservation of the revolution. He can only be radical up to a point.

Iranâ€™s apparent inclination to take up a U.S. invitation to attend a conference on Afghanistan later this month may be more significant than Khameneiâ€™s words. In any event, overcoming a 30-year impasse will take time and consistency.

The clock is ticking â€” and Obamaâ€™s will not be the same as that of Israelâ€™s prime minister designate, Benjamin Netanyahu.

Already divergent U.S. and Israeli approaches to Iran were evident in Israeli President Shimon Peresâ€™s coupling of his own Nowruz address to the Iranian people (not its leaders) with a statement predicting that they would rise up and topple â€œa handful of religious fanatics.â€

A senior Israeli official told me Iran has 1,000 kilos of low-enriched uranium and will have 500 more within six months, enough to make a bomb. It could then opt for one of three courses.

Rush for a bomb by shredding the nuclear nonproliferation treaty, adapting its centrifuges and producing enough highly enriched uranium within a year. Move the process to a secret site, in which case getting a bomb would take longer, perhaps two years.

Or continue making low-enriched uranium so that â€œit would have enough for 10 bombs if it decides to rush at a later stage.â€

And where, I asked, is Israelâ€™s red line? â€œOnce they get to 1,500 kilos, nonproliferation is dead,â€ he said. And so? â€œItâ€™s established that when a country that does not accept Israelâ€™s existence has such a program, we will intervene.â€

I think thereâ€™s some bluster in this. Israel does not want Obama to talk, talk, talk, so itâ€™s suggesting military action could happen in 2009, within nine months.

Still, this much is clear to me: Obamaâ€™s new Middle Eastern diplomacy and engagement will involve reining in Israeli bellicosity and a probable cooling of U.S.-Israeli relations. Itâ€™s about time. Americaâ€™s Israel-can-do-no-wrong policy has been disastrous, not least for Israelâ€™s long-term security.